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is as yet only slightly industrialized, but the industrial possibilities of the country are very great, and it may be taken as nearly certain that there will be a rapid development throughout the next few decades. China's future depends as much upon the manner of this development as upon any other single factor; and China's difficulties are very largely connected with the present industrial situation. I will therefore first briefly describe this situation, and then consider the possibilities of the near future.

We may take railways and mines as the foundation of a nation's industrial life. Let us therefore consider first the railways and then the mines, before going on to other matters.

When railways were new, the Manchu Government, like the universities of Oxford and Cambridge (which it resembled in many ways), objected to them, and did all it could to keep them at a distance. In 1875 a short line was built by foreigners from Shanghai to Woosung, but the Central Government was so shocked that it caused it to be destroyed. In 1881 the first permanent railway was constructed, but not very much was accomplished until after the Japanese War of 1894–5. The Powers then thought